Attorney General Ellison shuts down fraudulent debt settlement companies and secures over $1 million in refunds for consumers

In total, Ellison has returned over $2.8 million to victims of predatory debt settlement companies

October 21, 2024 (SAINT PAUL) — Today, Minnesota Attorney General Keith Ellison announced that his office has obtained a settlement requiring two debt settlement companies that illegally collected fees from customers and misrepresented their services to cease operating in Minnesota and provide full refunds to its Minnesota consumers. 

Related companies Financial Solutions Group and Accelerated Debt Settlement are alleged to have misrepresented their services and pocketed steep fees from consumers in exchange for promises that they could negotiate settlements of their debts.  The companies charged these fees before performing the promised services, which is illegal under Minnesota law regulating debt settlement services. 

Debt settlement companies often charge consumers hundreds or thousands of dollars of illegal upfront fees in exchange for often-dubious promises that they can settle the consumers’ debt for less than what they owe.  Federal and state law bans debt settlement companies from charging upfront fees, and state law requires the companies to be registered with the Minnesota Department of Commerce. 

Additionally, Financial Solutions Group and Accelerated Debt Settlement were operating without registering as debt-settlement service providers, as required by Minnesota law.  Attorney General Ellison’s Office alleges in the settlement that the companies violated Minnesota’s Debt Services Settlement Act, Prevention of Consumer Fraud Act, and Uniform Deceptive Trade Practices Act.

The settlement, filed in Ramsey County District Court, requires Financial Solutions Group and Accelerated Debt Settlement to pay the State $1,081,756.59 — the full amount it has collected from Minnesota customers — which the Attorney General’s Office will use to provide full restitution to consumers.  The Attorney General’s Office will contact impacted consumers who are entitled to refunds. Since taking Office, Attorney General Ellison has returned over $2.8 million to consumers harmed by fraudulent debt settlement companies.

“If done with integrity, helping people get out of debt is a noble pursuit,” said Attorney General Ellison. “However, I will not tolerate bad actors who take advantage of Minnesotans, especially people who are already struggling financially. I am glad to be shutting two more fraudulent debt settlement companies down and putting money back in the pockets of Minnesotans.”

Reputable credit counseling organizations can assist consumers struggling with consumer debt, and many are nonprofits that do not charge a fee for their services.  Consumers struggling with debt may wish to consider contacting the below agencies:

Lutheran Social Services Financial Counseling Service
(888) 577-2227
www.lssmn.org

 

National Foundation for Credit Counseling
(800) 388-2227
www.nfcc.org

Attorney General Ellison encourages anyone who has been victimized by a debt settlement company to file a complaint with the Minnesota Attorney General’s Office using this online form. The Office can also be reached by calling (651) 296-3353 (Metro area) or (800) 657-3787 (Greater Minnesota).

The Attorney General’s Office encourages borrowers to visit its website for additional information on how to avoid debt settlement scams, including a publication entitled Debt Assistance Scams.